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Patentability of software inventions, which are generally referred to as Computer Related Inventions (CRI), is a topic of constant debate, not just in India, but around the world. India has been trying to introduce objectivity to this topic, which is subjective by nature, by way of amendment to the Act, and by introducing guidelines for examining CRI over the years. The latest among these efforts, is the introduction of guidelines by the office of the Controller General of Patents, Designs and Trade marks, India (generally referred to as Intellectual Property Office – IPO). The guidelines came into effect from June 30, 2017, and replaces previous guidelines for examining CRI. The guidelines can be downloaded here.

The merits of such guidelines being binding on the patent applicants are questionable, since they neither supersede the Act nor caselaw. However, one can argue that these guidelines may be binding on the patent examiners (acting on behalf of the Controller). Nevertheless, these guidelines will have significant practical implications. The examiners are expected to follow these guidelines while examining CRI. Therefore, their rational while issuing examination reports, granting or rejecting patents to CRI will likely be in line with these guidelines. Further, these guidelines, if nothing, are at least an indirect reflection of the governments stand on patentability of CRI. Hence, there are several compelling reasons for discussing these guidelines in greater detail.

At the outset, it is worthwhile to point out that the guidelines (“new guidelines”) are favourable towards grant of patents for CRI, as compared to the outgoing guidelines (“earlier guidelines”). The notable difference between the two guidelines is the ouster of a “three stage” test, reproduced below, prescribed in the earlier guidelines to determine patentability of CRI.

(1) Properly construe the claim and identify the actual contribution;

(2) If the contribution lies only in mathematical method, business method or algorithm, deny the claim;

(3) If the contribution lies in the field of computer programme, check whether it is claimed in conjunction with a novel hardware and proceed to other steps to determine patentability with respect to the invention. The computer programme in itself is never patentable. If the contribution lies solely in the computer programme, deny the claim. If the contribution lies in both the computer programme as well as hardware, proceed to other steps of patentability. (emphasis added)

As per the test, a novel hardware had to be present, irrespective of how inventive the software is, for a patent to be granted. In other words, if the inventiveness lies only in software, then the same is not patentable. Such a stance goes against the legislative intent, which in fact clarified its position by introducing an amendment in 2002. The amendment excluded “computer programme per se”, instead of just “computer programme”, from being considered as patent eligible subject matter. The legislative intent to attach suffix per se to computer programme is evident in the view, presented below, expressed by the Joint Parliamentary Committee (JPC) while introducing the amendment.

In the new proposed clause (k) the words ''per se" have been inserted. This change has been proposed because sometimes the computer programme may include certain other things, ancillary thereto or developed thereon. The intention here is not to reject them for grant of patent if they are inventions. However, the computer programmes as such are not intended to be granted patent. This amendment has been proposed to clarify the purpose

The JPC states “the computer programme may include certain other things”, which may qualify them as inventions, and hence be awarded patents. Computer program cannot certainly “include” hardware. Therefore, the three stage test prescribed previously went against the legislative intent while dealing with CRI.

On the other hand, the debate is, what can a computer program “include” that is “ancillary thereto or developed thereon”, which make it an invention. In our view, computer program can include “technical manoeuvres”, again expressed as computer program, which nudge CRI from being categorized as “computer programme per se”.

The new guidelines do not deal with what “other things” the computer program can include that is “ancillary thereto or developed thereon”, which makes it an invention. Hence, the clarity one may desire in the guidelines while examining CRI is still largely absent. However, on a positive note, the guidelines offer stuffiest scope to the examiners to exercise discretion while examining CRI, and to the applicants to argue their case based on the Act, legislative intent and caselaw, without knocking the doors of the Intellectual Property Appellate Board (IPAB).

In conclusion, we welcome the new guidelines to the extent that the three stage test has been ousted, and offers scope for software inventions to be critically examined, without depriving them of patents for want of novel hardware.

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Introduction

Software development is a field that witnesses various types of innovation. Some of the innovations may be regarded as technical innovations, while others may be non-technical in nature. However, often technical innovations and non-technical innovations are intertwined, whereas patent protection is accorded to inventions that are technical in nature. Therefore, patent office of various jurisdictions have faced challenges while examining software inventions, or what is generally known as Computer Implemented Inventions (CII).

Among many jurisdictions, India and the European Patent Convention (EPC) have statutes for preventing non-technical inventions from being patented. One may be tempted to even say that India leans towards the EPC approach of dealing with CII, both in terms of statute and patent office guidelines. However, in India the guideline for dealing with CII has been evolving over the years.

The EPC excludes computer programs "in itself" from being patented. In effect, inventions which do not consist purely of computer programs and codes, but instead implement the programs in a device (hardware) may constitute potentially patentable subject matter. A CII is one which:

involves the use of a computer, computer network or other programmable apparatus

has one or more features realized wholly or partly by means of a computer program

While "programs for computers" are listed under excluded subject matter, the same may not be excluded from patentability if it is capable of bringing about, when running on or loaded into a computer or any hardware, substantial technical effect that goes beyond the "normal" physical interactions between the program (software) and the computer (hardware) on which it is run. A further technical effect which lends technical character to a computer program may exist

in the control of an industrial process; or

in the internal functioning of the computer itself or its interfaces under the influence of the program and could, for example, affect the efficiency.

However, a note should be made that the normal specifications of a computer or any hardware, for example, electrical currents, among others, do not contribute technical character to a computer program, and a further technical effect is needed. The further technical effect may or may not be known in the prior art. In other words, or in a layman’s language, if any programs running in the computer is capable of bringing about certain remarkable result in the functioning or operation of the computer itself or any other hardware onto which such programs are loaded, then the subject matter, although includes computer programs, may be included under patentable subject matter.

A simple test to determine whether technical character exists in a claim covering CII would be to consider whether each feature or their combination lends any technical contribution to the claim.

To determine existence of technical contribution, one may check whether the claimed technical effect results in the computer being made to operate in a new way that is more efficient and effective. Further, if the resultant technical effect overcomes the objective technical problem, then the claim in question has “further technical effect”.

If claimed subject-matter relating to a computer program does not have a technical character, the claim may be rejected. If the subject-matter passes the test for technicality, the examiner proceeds to the questions of novelty and inventive step.

Let’s take a look at what happened in Apple Inc. and HTC Corporation concerning Apple’s patent European Patent No. 2 098 948 (the ‘948 patent”). The ‘948 patent relates to computer devices with touch sensitive screens which are capable of responding to more than one touch at a time. The judge found claims 1 and 2 were invalid because they related to computer programs as such. The court of Appeal, however found the judge’s decision erroneous and traversed the judge’s decision. The specification addresses the problem associated with multi-touch interface. The Court of Appeal affirmed that the problem which the patent addresses, namely how to deal with multiple simultaneous touches on one of the new multi-touch devices, is essentially technical. The Court of Appeal further explains that the solution to this problem lies in a method of dividing up the screen of such a device into views and configuring each view as a multi-touch view or a single-touch view using flags with a specific functionality in the manner, and that the method concerns the basic internal operation of the device and applies irrespective of the particular application for which the device is being used and the application software which it is running for that purpose. Further, the Court stated that it causes the device to operate in a new and improved way and it presents an improved interface to application software writers. Hence, the Court of Appeal asserted that invention does make a technical contribution to the art and its contribution does not lie in excluded matter.

Application of Problem-Solution Approach (PSA) for assessment of inventive step of claims that consists of both technical as well as non technical features

A common case with CII is that claims of such inventions may have a mix of technical and non-technical features. When assessing the inventive step of such a claim, those features which contribute to the technical character of the invention are taken into account. These may also include the features which, when considered individually, are non-technical, but in the context of the invention, contribute to producing a technical effect serving a technical purpose, thereby contributing to the technical character of the invention. However, if a feature contributes only to the solution of a non-technical problem, such a claim cannot support the presence of an inventive step.

The problem-solution approach is applied to mixed-type inventions so as to ensure that inventive step is acknowledged by taking into consideration all those features which contribute to technical character of the claim and not on the basis of features not contributing to the technical character of the invention.

The features which contribute to the technical character of the invention are determined.

Closest prior art is selected based on the features contributing to the technical character of the invention identified in the previous step.

The differences from the closest prior art are identified.

The claim(s) as a whole is/are determined in order to identify and differentiate the features which make a technical contribution from those which do not.

If no differences (even non-technical difference) are found, an objection under Art 54 is raised. If the differences do not make any technical contribution, an objection under Art 56 is raised. If the differences include features that make technical contribution, then, the objective technical problem is formulated on the basis of the technical effect(s) achieved by these features. Further, if the claimed technical solution to the objective technical problem appears obvious to the person skilled in the art, an objection under Art 56 is raised.

A prima facie determination of the features contributing to the technical character of the invention is performed for all the features. The technical effects achieved by the differences over the selected closest prior art are determined and the extent to which the differences contribute to the technical character of the invention is analysed based on these technical effects. A detailed analysis may reveal that some features considered prima facie as not contributing to the technical character of the invention do, on closer inspection, appear to make such a contribution. The reverse situation is also possible. In such cases, the selection of the closest prior art might need to be revised.

While applying PSA to determine technical and non technical character of a claim, care should be taken to avoid missing any features that might contribute to the technical character of the claimed subject-matter.

Conclusion

In conclusion, claimed subject-matter is always considered as a whole when evaluating whether individual features contribute to its technical character. However, only that part of the subject-matter which is determined to contribute to its technical character is taken into account when assessing inventive step. As long as there is at least one technical feature, the whole claim has technical character, and is therefore not excluded from patentability.

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Most often software in computer systems is located within a user device (client) and a remote computing resource (server). The client can be at one location, connected over a network (e.g., the internet) to the server. A user accesses the internet with a device to request or upload data to the server over the network. The server processes the request, or stores the data and delivers the result over the network.

Software related inventions as a whole can be operated across territorial borders. Thus, the question arises whether the software patent can be enforced, since it is known that patents rights are territorial in nature.

Consider a patented software invention in the United States covering a “product recommendation” method and system. A competitor enables users in the United States to download an application onto a mobile device. The user accesses the application to browse through products. The activity of the user is sent to a server located in India. The server processes the information in India and provides product recommendations. The product recommendations would then be available to the user on his device in the United States.

Patent Infringement Liability:

Continuing from the above example, an owner of such a software patent would be in a dilemma as to whether the competitor is liable for infringement of his patent, given the fact that, his patent only covers United States, and the competitor is carrying out part of the invention outside United States.

Such scenarios have come before courts in US and UK, and the decisions are encouraging for software patent owners. We will be discussing a case between NTP Inc. and Research In Motion Ltd, in US, and another case between Menashe Business Mercantile Ltd. & Anor and William Hill Organization Ltd, in UK. In both the cases, even though the competitors argued that part of their systems was outside the jurisdiction of the patents, the competitors were held liable for infringement.

Case 1: NTP Inc. v Research In Motion Ltd

In November 2001, Research in Motion(RIM) was sued by NTP Inc. RIM is the manufacturer of the BlackBerry device, NTP sued RIM for infringement of five US patents, which NTP alleged covered the BlackBerry system.

The five patents of the NTP were covering the components and process necessary for integrating an email service and wireless network.

BlackBerry enabled its users, through its devices, to not only make conventional telephone calls, but also to have email access through the BlackBerry "push technology”. The BlackBerry email system intercepts a message to an email user and then routes the message to a relay component that in turn routes the message to a network. The BlackBerry "Relay" component, which was equivalent to one of the claim limitations in NTP patents, was located in Canada.

In the District court, the jury found RIM infringing on all the claimed elements, except for RIM's relay component, which was located in Canada, all the other elements of NTP's claims was present within the United States. However, the jury found that the operation of the BlackBerry was accomplished according to method claim described in NTP's patent and awarded monetary damages and entered a permanent injunction enjoining RIM from further manufacture, use, importation and sale of accused BlackBerry devices.

RIM appealed to the Federal Circuit, challenging the District Court’s claim interpretation, as well as disputing the applicability of § 271(a) to its extraterritorial operations, based on the point that the relay component of the BlackBerry system was located in Canada. The Federal circuit considered this argument, but reasoned that

"even though one of the accused components in RIM’s BlackBerry system may not be physically located in the United States, it is beyond dispute that the location of the beneficial use and function of the whole operable system assembly is the United States".

The Federal circuit concluded that:

“the location of RIM’s customers and their purchase of the BlackBerry devices establishing control and beneficial use of the BlackBerry devices within the United States satisfactorily establish territoriality under section 271(a).”

In October 2001, William Hill was sued by Menashe in UK. The patent granted to Menashe is "Interactive, computerized gaming system with remote control".

William hill enabled users in UK to install software program on their computers. This allowed the users to access a server which was part of William Hill’s on-line gaming system. However, the servers were located in Antigua. Menashe sued William hill for a contributory infringement.

William accepted that the CD containing the software program was an essential element of the invention, but disputed that the patent was not put into effect in UK, since the server was located in Antigua. William took the above line of argument as defense.

However, the decision was in favor of Menashe. The judge affirmed that:

“The claimed invention requires there to be a host computer. In the age that we live in, it does not matter where the host computer is situated. It could be in the United Kingdom, on a satellite, or even on the border between two countries. Its location is not important to the user of the invention nor to the claimed gaming system. In that respect, there is a real difference between the claimed gaming system and an ordinary machine. For my part I believe that it would be wrong to apply the old ideas of location to inventions of the type under consideration in this case. A person who is situated in the United Kingdom who obtains in the United Kingdom a CD and then uses his terminal to address a host computer is not bothered where the host computer is located. It is of no relevance to him, the user, nor the patentee as to whether or not it is situated in the United Kingdom.”

The Judge’s view was:

“it would be wrong to apply the old ideas of location to inventions of the type under consideration in this case.” Instead, it is pertinent to ask who uses the claimed gaming system. The answer must be the punter. Where does he use it? There can be no doubt that he uses his terminal in the United Kingdom and it is not a misuse of language to say that he uses the host computer in the United Kingdom. It is the input to and output of the host computer that is important to the punter and in a real sense the punter uses the host computer in the United Kingdom even though it is situated in Antigua and operates in Antigua. In those circumstances it is not straining the word "use" to conclude that the United Kingdom punter will use the claimed gaming system in the United Kingdom, even if the host computer is situated in, say, Antigua. Thus the supply of the CD in the United Kingdom to the United Kingdom punter will be intended to put the invention into effect in the United Kingdom”.

Conclusion:

From both the cases, we can conclude that, patent rights may be enforced even though one of the elements in the claimed system or method is located outside the territory of the patent, provided that the beneficial use of the system occurs within the territory of the patent granted.

In this new age of complex patent enforcement scenarios, to strengthen the patent rights of an invention relating to cloud computing, a careful strategy should be adopted for drafting and filling patent applications.

The India IT industry has witnessed tremendous growth is the past decade, resulting in large IT companies and inceptions of several promising start-ups. In the initial phases, the IT industry was largely focused on offering services. However, eventually, several companies started creating software products. Companies that create software products strive on innovation to create unique products to counter competition, hence, the desire to protect such innovation through patents and sustain competitive advantage.

Patent laws of several countries favour patent protection for software innovation. Such countries include USA, Australia and Singapore, to name a few. However, many other countries, which include India and European nations, have more stringent laws concerning patent protection to software innovation.

Indian Patent Act offers patent protection to product or process (if they satisfy various requirements of patentability) as long as they do not fall under non-patentable subject matter. Section 3 and 4 of the Indian Patent Act specify a list of subject matter that is not patentable. Section 3(k) of the Indian Patent Act, which is provided below, is of specific importance to software innovation.

“What are not invention – The following are not inventions within the meaning of this Act, – a mathematical or business method or a computer program per se or algorithms;”

Amateursoften refer to the above section and state that none of the software innovations are patentable in India. However, the reality is far from such perceptions.

To begin with, the patent office, in its “MANUAL OF PATENT OFFICE PRACTICE AND PROCEDURE” (MPPP) offers some clarity, if not to a great extent, on what kind of software innovations will be considered as “computer program per se” and held non patentable, and what kind of software innovations do not fall under section 3(k).

Before we move any further, one thing is certain from the inclusion of such explanation in the MPPP:

Not all software innovations fall under section 3(k). Hence, a wide range of software innovations are patentable even in India.

Having said that a wide range of software innovations are patentable in India, one has to be aware that, almost all patent applications for software innovations are initially objected by the patent office citing section 3(k).

However, if the application for a patent (patent specification) is crafted intelligently by understanding the Indian patent prosecution practice, one can successfully obtain protection for software innovation.

One of the keys for successfully having a patent granted for software innovation lies in the ability to present the innovation in such a way that the innovation, which we are aiming to protect, includes subject matter which is not a computer programme. Further, subject matter that is “not just a computer program” should be intelligently made an essential part of the invention, without compromising on the scope of protection.

The above opinion is reinstated by the fact that the Indian Patent Office has been granting patents to, what is normally perceived as “software innovations”. We have provided below, an exemplary list of patents granted by the Indian Patent Office to software innovations:

Company

Patent No.

Title of the patent

Google

252220

Generating user information for use in targeted advertising

Google

252156

Method and system for text segmentation

Google

246911

A method for automatically targeting web-based advertisements

Oracle

245515

Tracking space usage in a database

Oracle

252448

In-place evolution of xml schemas in databases

Ebay

242805

Facilitating micropayments between a plurality of parties

Ebay

239304

Method and system for scheduling transaction listings at a network-based transaction facility